Bitcoin Tanks Below the $40K Mark, Again
BTC (Bitcoin) price has again dwindled below the $40K mark on Friday It started trading on Monday at a low price of $37,473 before it rallied to $43,953 recording a 17.29% increase on the same day. On Wednesday, BTC (Bitcoin) has already breached the $45K mark with its price at $45,069 in data by Crypto.co. But the price rally was unsustainable after its price declined to $41,852 on Thursday. Despite this, its price continued to be above the $40K mark before sliding to $38,621 on Friday.
Bitcoin has been on consecutive price crashes over the past few months. Cryptocurrencies have been under fire by regulatory bodies across the globe. In January, the U.S. Federal Reserve announcement on the implementation of raising interest rates resulted in the crypto industry’s 6% decline in market cap. It was followed by another price crash in just two weeks wiping $150B of the industry’s market cap following the US Fed announcement of reducing its balance sheet along with tapering of bonds and raising of interest rates according to a report by CNBC. The United Kingdom, Spain, and Singapore also proposed to implement tougher regulations on cryptocurrencies. Adding up to the injury, the Russian central bank proposed a total ban on cryptocurrencies. BTC (bitcoin) slide below the $38K mark, the first time in six months with its of $35,494. Since then, breaching the $40K mark has been so elusive.
On Feb. 4, following Amazon.com’s strong earnings increased investors’ confidence in technology stocks, BTC (Bitcoin) price increased by 10% with its price at $41,737. Its price has been steadily within the $40K mark over the next two weeks. On Feb. 18, BTC (Bitcoin) price dropped below the $40K mark with its price at $39,496 investors fear due to the Russia-Ukraine conflict. Prices rebounded shortly after but Bitcoin along with major cryptocurrencies continued on their price swings as the conflict progresses. On Mar. 2, the most dominant cryptocurrency along with other digital assets made a sharp rebound after its price regained the $45K mark which could be an indication of a bullish trend. But analysts were skeptical pointing out that March is usually a difficult month for bitcoin and equities. And we see the truth behind this statement given bitcoin and other cryptocurrencies’ current movement.
Swiss Gov’t to Freeze Crypto Assets Owned by Russian Citizens
Following the sanction implemented by the European Union against Russia, Switzerland has now followed suit. In his statement, Guy Parmelin, the Swiss finance minister has confirmed the country’s adoption of four EU sanctions implemented on Russia.
“As of today, all four of the EU’s sanctions packages have been adopted and implemented in Switzerland.”
Russia’s invasion of Ukraine has pushed the EU to implement sanctions against Russia. Hence, there was news that Russia might use cryptocurrencies to evade sanctions. But this has been immediately countered by the EU after announcing that it will stop any attempt by Russia to use cryptocurrencies to dodge the sanctions as revealed by French Finance Minister Bruno Le Maire in his statement to the Financial Times.
“We are taking measures, in particular on crypto assets which should not be used to circumvent the financial sanctions decided upon by the 27 EU countries.”
In line with this, there were already 200 Russians with bank accounts and physical assets frozen by the Swiss authorities since last week. But the Swiss government action has also expanded to crypto assets owned by Russians within territories under its jurisdiction. According to the Swiss finance ministry, the country’s current move is aimed at protecting its reputation as one of the leading crypto hubs in the blockchain industry. It remains a question though how this will be implemented considering how crypto holders store their virtual assets in non-custodial or cold wallets. And this was admitted by a senior official of the Swiss finance ministry.
“If someone holds their crypto key themselves then, wherever they are, it’s going to be virtually impossible to identify them.”
The crackdown can only be implemented if the crypto assets are held within custodial wallets by crypto businesses as revealed by the official.
“But if they are using crypto services—funds, exchanges, and so on—these service points we can target.”
Leading Exchanges Say “No” to Preemptively Banning of Russian Users
Following Russia’s invasion of Ukraine on Feb. 24, there has been a clamor worldwide to impose a ban on Russian banks, state-owned businesses, and Russian key individuals.
On Feb. 27, Ukraine’s vice-prime minister Mykhailo Fedorov has made a call to all leading crypto exchanges to block addresses of Russian users. He further added that it is “crucial to freeze not only the addresses linked to Russian and Belarusian politicians, but also to sabotage ordinary users”.
The fear of Russia turning to crypto has somewhat validated as trading of BTC (bitcoin) and other virtual assets in the ruble has doubled and even reached $60 million on Monday.
But Binance CEO and founder Changpeng Zhao rejected the idea of preemptively banning Russian users. Zhao stated:
“To unilaterally decide to ban people’s access to their crypto would fly in the face of the reason why crypto exists.”
Coinbase CEO Brian Armstrong in his tweet stated that all US companies should comply with the law.
2/ Every US company has to follow the law – it doesn't matter if your company handles dollars, crypto, gold, real estate or even non financial assets. Sanctions laws apply to all US people and businesses.
— Brian Armstrong – barmstrong.eth (@brian_armstrong) March 4, 2022
But the Coinbase according to Armstrong holds the same position as Binance as stated in this tweet.
7/ In addition, we are not preemptively banning all Russians from using Coinbase. We believe everyone deserves access to basic financial services unless the law says otherwise.
— Brian Armstrong – barmstrong.eth (@brian_armstrong) March 4, 2022
But he also reiterates that “if the US government decides to impose a ban, we will of course follow those laws.”
Other leading exchanges like OKX and Kraken also stated that they will not be implementing a bulk ban on Russian accounts. Jesse Powell, founder of the exchange Kraken has this to say about the issue.
“Bitcoin is the embodiment of libertarian values, which strongly favour individualism and human rights.”
But South Korean exchanges Bithumb, Coinone, Upbit, and Korbit were on the opposite side and have already closed their doors to Russian users. Ukrainian exchange Whitebit has also joined their fold. The crypto exchange has blocked all trading activities in Ruble, Russia’s currency including registration from banned territories.
“Procedures for checking for sanctions lists have been introduced, trading activities with RUB [Russian ruble] have been closed, and registration of users from the countries of the Russian Federation and the Republic of Belarus have been suspended.”
In a crisis like this, which should come first? Will it be the users’ interest or sanctions implemented by sovereign countries?
Burger Chain Runs BTC Giveaway on Cash App
Burger chain Shake Shack has launched a BTC (bitcoin) giveaway to its customers on Cash App. Shake Shack is famous for its “100% antibiotic-free Angus beef and buttered buns”. With its latest promo, the burger wants to test the waters whether cryptocurrencies would appeal to its customers who are largely comprised of the younger generations. Jay Livingston, chief marketing officer of the burger chain, in his statement with Wall Street revealed:
“You’re always trying to place your bets on those things that truly will be meaningful and not waste resources on the ones that won’t.”
Shake Shack’s latest promo offers up to a 15% cashback reward in BTC (bitcoin) with every purchase using the Block’s Cash App debit card. But this is not the first time that Block was engaged in an activity with the most dominant cryptocurrency. It started supporting BTC (bitcoin) in 2018 and users were allowed to send it for free to expose them to cryptocurrencies. And this feature has motivated Shake Shack to partner with the company for its latest promo as stated by Mr. Livingston.
“If we just started taking crypto right now at our kiosk, it would have very low adoption. But through someone like Cash App, who’s been promoting it, you will get some more people that want it and that also want to learn.”
Whether accepted as payment to promotions like this, will definitely drive BTC (bitcoin) and other cryptocurrencies to their further adoption on the mainstream.